Bitcoin’s Biggest Competition: A 105-Year-Old Non-Profit?

In past noteworthy public comments on cryptocurrency, Goldman Sachs’ then-CFO Marty Chavez used the infamous phrase “fake news” to describe media reports that suggested the bank was abandoning plans to launch a crypto trading desk (i.e., Bitcoin and other crypto-specie).

Fast-forward one year, and Chavez, now Goldman’s current co-head of securities, has offered up an interesting take on a potential obstacle facing Bitcoin and other cryptocurrencies.

In typical style, Chavez leveraged a personal anecdote to help illustrate his point. Speaking on a podcast from crypto-focused outlet The Block, Chavez recalled being asked by an old friend at a venture capital firm to speak to a few CEOs of Bitcoin-related startups. During one of the talks, Chavez threw out a prediction that he didn’t feel was all that revolutionary, and one he appears to still back today. Chavez told the CEO he was “highly confident” that the Federal Reserve will one day digitize the U.S. dollar, a move that could tip the crypto coin market on its head. The probability of a Federal Reserve-issued cryptocurrency “seemed self-evident,” he said.

In other words, the Federal Reserve, a 105-year-old nonprofit, founded in the same year that the Ford Motor Company introduced the assembly line, could end up totally disrupting the market for crypto-currency (and Bitcoin). Not bad for an institution more than a century old.

Chavez wasn’t particularly won over by the response of the unnamed Bitcoin-startup CEO, who argued with “equal certainty” that it will never happen. “I asked him why… and he said because no engineer who’s any good will ever help the Federal Reserve do that,” Chavez recalled, later saying the rationale didn’t “make a lot of sense to me.”

Have his views changed over the last few years? “I don’t know what the Federal Reserve is going to do, but I look at the recent announcements and I think it’s all consistent with [my earlier] statement,” he told The Block. And why, exactly, should the Fed play a role? The core principle is protecting nationally-recognized legal tender. (Basically, no government wants a viable currency to compete with its own, especially one like Bitcoin that might actually have legs.)

In addition to Bitcoin chatter, the Goldman executive dropped a few other interesting nuggets during the 45-minute talk, including his hatred of the word “strat” and an oral history of the short-lived title “strader.” The longtime Goldman exec said he preferred the highly-creative alternative role “engineers who trade.” Literally.

Chavez also said one of the other CEOs sent him three Bitcoins following the meeting. Chavez still owns them. 

This article originally appeared in eFinancialCareers.

6 Responses to “Bitcoin’s Biggest Competition: A 105-Year-Old Non-Profit?”

  1. wageSlave

    Anyone who has studied the FED knows how this will work out. When the FED was created, stock was offered to the member banks. The member banks didn’t have enough money to control all the stock. So, the banksters printed it by lending electrons to each other and only lending to each other. Now they own all the stock and it cost them nothing but a bunch of loan documents. The stock market trades in dollars. The banksters will eventually print and buy Bitcoins with dollars. Wink wink knode knode. And they will buy it with electrons. Or they will crush it with stock market fluctuations. As long as the FED has its charter(monopoly on printing money) from the US government and the dollar is the world currency there is no stopping the banksters from doing what the banksters want.

  2. John L. Ries

    The headline is definitely clickbait as the US Federal Reserve System is a quasi-governmental agency headed by a Board of Governors appointed by the President of the United States. It’s true that the member banks hold two thirds of the stock in the regional Federal Reserve Banks, but the Feds hold the remaining third (voted by the Board of Governors), which makes them the 500 lb. gorilla.

  3. fuck the fed

    the fact that These big sites, corps, and “independant” writers, still praise and talk postively about the FED is mindblowing. The damage that the FED has done to the US, let alone the world is INCALCULABLE. it needs to be removed and disassembled.

    Dice, if anyone there reads this, you really need to rethink some stuff. quick google searches prove the fed is a poison, and only was voted in by congress in some beyond crooked manners. President Jackson even repealed it. and yet its slimy paws grabbed a hold of weak congress members and it weaseled its way in. This isn’t conspiracy theory BS, this is damn fact. The fed is the reason we are in so much debt. The FED is the reason for a countless number of problems. So saying they are a “non profit” just reeks of irresponsibility and naïveté.